Jeff Bezos
(1964– )
Founding Amazon, the online “everything store,” which disrupted commerce even more radically than Aaron Montgomery Ward did with his massive mail-order catalog in 1872 or Richard Warren Sears with his far more massive catalog in 1894, was a product of what Jeff Bezos called his personal “regret minimization framework.” The digital transformation of commercial civilization started in 1994 with a company Bezos planned to call Cadabra until he did a double take when his lawyer misheard the name as Cadaver. That set him on a fast search for a new label, and he didn’t feel he had much time to find one. He was in the throes of anxious regret, believing he had missed his chance to get a jump on market competition because he had been unwilling to risk entry into the Internet business boom of the early 1990s. Driven by regret, he had already left a lucrative Wall Street job as vice president of the hedge-fund firm D. E. Shaw & Co. so that he could sink everything into the new company with, it turned out, a name that sounded like a synonym for corpse.
Leaving the safety of Shaw had been part of a uniquely entrepreneurial move, compounded of chance, impulse, insight, and preparation. Cadabra, the name, misfired because at least one person heard it wrong. But nobody wants a Cadaver on their hands. Amazon wasn’t Bezos’s next first choice, either. He bought the URL Relentless.com, only to back away when more than one friend said it sounded “sinister.” So, he resorted to research—very little research, because there was so little time. But it turned out to be just enough. He tore through the dictionary, limiting himself to the A’s, because he wanted to be at or near the top of any list. He chose Amazon because it was “exotic and different.” As a rationale, it showed an instinctive understanding of Internet marketing, which required above all else the quality of being different and exotic to attract a click. But there was also substance to the “Amazon” method. It was the biggest river on the planet, and Bezos intended to build the biggest store, one that offered everything, one that invited exploration of the unknown.
But before he got to everything, he needed to start somewhere. Reasoning that there was always a high demand for literature, he decided to start by selling books. The universe of this product was huge, much larger than could be contained in any store built of bricks and mortar; the price point per unit was relatively low; and the merchandise was easily shipped. His first world headquarters was the garage attached to his house in Bellevue, Washington.
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He was born Jeffrey Preston Jorgensen in 1964, in Albuquerque, New Mexico. His mother, Jacklyn Gise, and his father, Theodore John Jorgensen, divorced when Jeffrey was less than a year old. Jacklyn had married young, at seventeen, and remarried when her son was four. Her father, Lawrence Preston Gise, was the regional director of the U.S. Atomic Energy Commission (AEC) in Albuquerque and had earlier worked for DARPA (Defense Advanced Research Projects Agency), the Department of Defense agency that had commissioned the creation of ARPANET, direct precursor of the Internet. Her second husband was Miguel “Mike” Bezos, who had immigrated to the United States on his own at age fifteen. When he adopted Jeff, the kid’s name became Bezos, and the family moved to Houston, where Mike went to work as an engineer for Exxon, and Jeff entered public school, where he quickly showed great aptitude for science and technology. By the time he was ready for high school, the Bezos family had moved to Miami and high schooler Jeff enrolled in a pre-college Student Science Training Program at the University of Florida.
After graduating from high school first in his class and valedictorian as well as a National Merit Scholar, Jeff Bezos enrolled in Princeton University, from which he graduated Phi Beta Kappa in 1986 with bachelor degrees in electrical engineering and computer science. His first job was on Wall Street with FITEL (First International Telecom), building a digital network for global trade. After a stint with Bankers Trust, he joined D. E. Shaw, specializing in Internet hedge-fund investment opportunities.
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As a digital geek who also had high-end hedge-fund chops, Bezos combined and confounded the stereotypes associated with technocrats and plutocrats. He presented the persona of a loose, impulsive, charismatic experimentalist entrepreneur, yet possessed the drive implied by the earlier name of his company: he was relentless. An August 15, 2015, New York Times article portrayed Amazon as a company of “Big Ideas in a Bruising Workplace,” describing the environment as “soulless” and “dystopian,” a “workplace where no fun is had and no laughter heard.” Bezos strenuously denied the characterization.
But there was undeniably a disruptively contradictory quality about his company. In contrast to the great majority of start-ups, especially in the digital space, Bezos presented a business plan that promised no profit for at least four to five years. This made for a great deal of controversy, but when Amazon emerged as one of the survivors of the early twenty-first-century “dot-com bubble,” when legions of start-up dot-coms became instant dot-bombs, the plan began to make sense. While the Amazon business model was all about speed and frictionless agility, the business plan was drawn up for the long term and not for day traders. By 2011, Amazon had 30,000 full-time employees in the United States. By the close of 2016, it employed over 300,000 people worldwide.
The company made its name as the preeminent digital bookstore, the success of which put most big brick-and-mortar chains out of business by the second decade of the twenty-first century, save Barnes and Noble. But Amazon evolved beyond books, becoming the “everything store” Bezos had originally envisioned. Bezos did much to bridge the gap between cyberspace and physical space, creating innovative systems for the rapid and accurate fulfilment of orders—with some merchandise even offering same-day delivery. Bezos also launched an experimental program in the use of drones to air-deliver merchandise.
As Amazon expanded its retail offerings, it invested in other digital companies and began acquiring or spinning off what is today more than forty full-fledged subsidiaries, among them Zappos (online clothing and shoes), Shopbop (fashion), Diapers.com (diapers and other infant-related consumables), Amazon Robotics (formerly Kiva Systems, maker of mobile robotic fulfillment systems), Audible (audio books), Goodreads (social catalog site for books), and IMDb (the movie database). In 2005, Amazon acquired CreateSpace, originally an online distributor of on-demand DVDs, which Amazon in 2009 expanded into a comprehensive provider of self-publishing services for authors, publishers, film studios, and music labels. Thus, the company that started out as a digital bookstore also became a digital publisher. As for films, Amazon Studios, established late in 2010, began producing television programming and feature films, often selecting scripts through crowdsourcing.
Today the world’s biggest Internet retailer as measured by revenue and market capitalization, Amazon has made Jeff Bezos the richest person in the world, with a net worth of $121.3 billion as of early 2018. He has used the wealth generated by Amazon to launch new and highly diverse enterprises, including Blue Origin, a company dedicated to human spaceflight, and the acquisition of the Washington Post. His Bezos Expeditions entity is a vehicle for his personal investments, which include the likes of Airbnb, Google, TeachStreet (a search engine to find teachers), and Uber. He has also founded and funded several philanthropic enterprises, mostly educational and medical or related to generally liberal political causes.
Most profoundly, though, Bezos has used digital technology to tear down most of the walls separating business sectors. Amazon both sells and publishes books, along with just about everything else. It streams entertainment of all sorts, and it creates entertainment. It is a formidable storefront, warehouse operation, and distribution empire, all in one. And it is a source of funding for the research and development of technologies of all kinds, including those dedicated to manned space flight. Vertical monopolies are not new. Famously, early in the twentieth century, John D. Rockefeller created in Standard Oil a company that controlled the means of exploring and drilling for and extracting, refining, delivering, distributing, and retailing petroleum products. Jeff Bezos started Amazon as an online bookstore, but he never intended to stop there. Today, it is best described as an online business, which makes it sufficiently agile to do whatever can be done over the global World Wide Web.